Insider Buyers Lose Additional US$137k As eHealth Dips To US$24m
Insiders who bought US$297.6k worth of eHealth, Inc.'s (NASDAQ:EHTH) stock at an average buy price of US$1.40 over the last year may be disappointed by the recent 15% decrease in the stock. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only US$160.9k.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
eHealth Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when CEO & Director Derrick Duke bought US$259k worth of shares at a price of US$1.38 per share. That means that an insider was happy to buy shares at above the current price of US$0.76. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
While eHealth insiders bought shares during the last year, they didn't sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
View our latest analysis for eHealth
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Does eHealth Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that eHealth insiders own about US$1.8m worth of shares (which is 7.3% of the company). We do generally prefer see higher levels of insider ownership.
What Might The Insider Transactions At eHealth Tell Us?
The fact that there have been no eHealth insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. While we have no worries about the insider transactions, we'd be more comfortable if they owned more eHealth stock. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing eHealth. For example - eHealth has 2 warning signs we think you should be aware of.
But note: eHealth may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.